Published July 12, 2014

CABAZON – Among the windmills and creosote bushes of San Gorgonio Pass, a nondescript beige building stands flanked by water tanks. A sign at the entrance displays the logo of Arrowhead 100% Mountain Spring Water, with water flowing from a snowy mountain. Semi-trucks rumble in and out through the gates, carrying load after load of bottled water.

The plant, located on the Morongo Band of Mission Indians' reservation, has been drawing water from wells alongside a spring in Millard Canyon for more than a decade. But as California's drought deepens, some people in the area question how much water the plant is bottling and whether it's right to sell water for profit in a desert region where springs are rare and underground aquifers have been declining.

"Why is it possible to take water from a drought area, bottle it and sell it?" asked Linda Ivey, a Palm Desert real estate appraiser who said she wonders about the plant's use of water every time she drives past it on Interstate 10.

"It's hard to know how much is being taken," Ivey said. "We've got to protect what little water supply we have."

Over the years, the Morongo tribe has clashed with one local water district over the bottling operation, and has tried to fend off a long-running attempt by state officials to revoke a license for a portion of the water rights. Those disputes, however, don't seem to have put a dent in an operation that brings the Morongo undisclosed amounts of income through an agreement with the largest bottled water company in the United States.

The plant is operated by Nestle Waters North America Inc., which leases the property from the tribe and uses it to package Arrowhead spring water as well as purified water sold under the brand Nestle Pure Life.

The Desert Sun has repeatedly asked the company for a tour of the bottling plant since last year, but those requests have not been granted. The company and the Morongo tribe also did not respond to requests for information about the amounts of water bottled each year.

Until 2009, Nestle Waters submitted annual reports to a group of local water districts showing how much groundwater was being extracted from the spring in Millard Canyon. Reports compiled by the San Gorgonio Pass Water Agency show that the amounts drawn from two wells in the canyon varied from a high of 1,366 acre-feet in 2002 to a low of 595 acre-feet in 2005. In 2009, Nestle Waters reported 757 acre-feet pumped from the wells during the previous year.

Since then, neither the company nor the tribe has submitted those annual forms, and a rounded estimate of 750 acre-feet a year has been listed in the water agency's reports — 244 million gallons a year.

None of the figures have been independently verified, and it's also uncertain how much water the bottling plant could be drawing from other local sources.

Separate reports filed by the Morongo tribe with the state show that during 2013, 598 acre-feet of groundwater was pumped in Millard Canyon, and 3 acre-feet of water was diverted. Those amounts translate to about 200 million gallons a year — enough water for about 400 typical homes in the Coachella Valley.

As a sovereign nation, the Morongo Indians are exempt from oversight by local water agencies and don't face the same reporting requirements as other entities. They have kept confidential information that would typically be disclosed elsewhere, such as data on groundwater pumping and water levels in most of the reservation's wells. Without that information, it's difficult for outside observers to assess the bottling plant's impacts on water supplies.

Several years ago, water researcher Peter Gleick was allowed to visit Millard Canyon and described seeing wells that pump water from the same aquifer that feeds the spring. He also saw a small stream flowing among cottonwood trees.

To what extent the spring may still be flowing isn't clear because the tribe controls access to that area at the base of the San Bernardino Mountains. But drawing water out of the canyon means less water flowing in the stream and seeping downhill to recharge aquifers — and that is a personal concern for Gleick, who enjoys exploring desert oases in Southern California.

"Surface water is so rare and the biological communities around these oases are so unique that these kinds of bottling plants in the desert should give us pause," said Gleick, who is president of the Pacific Institute in Oakland. "If they weren't pumping, the volume that they're taking out would be going into either recharging groundwater or providing some surface flows."

In his 2010 book "Bottled and Sold," Gleick described the inner workings of the Cabazon plant, which covers an area larger than seven football fields, saying it was producing more than 1 billion bottles of Arrowhead spring water a year. Labels on the bottles list several sources of water, including the spring in Millard Canyon and other springs elsewhere in Southern California.

"The reason this particular plant is of special concern is precisely because water is so scarce in the basin," Gleick said. "If you had the same bottling plant in a water-rich area, then the amount of water bottled and diverted would be a small fraction of the total water available. But this is a desert ecosystem. Surface water in the desert is exceedingly rare and has a much higher environmental value than the same amount of water somewhere else."

When Gleick visited the canyon, he noticed the vegetation seemed to have died back around the oasis because the stream's flow had dwindled. He said there ought to be an assessment of how the shrinking flows are affecting the ecosystem. As far as he knows, no such assessment has been carried out.

Michael Fisher, a spokesman for the Morongo, responded to questions about the bottling plant with an emailed statement.

"The Morongo Band of Mission Indians is a sovereign nation with a long history of caring for the environment and of environmental stewardship as it relates to air quality, local habitats and tribal water resources," Fisher said. "Morongo's successful partnership with Nestle Waters North America provides over 250 local jobs through the operation of a sustainable water-bottling plant that provides water for human consumption only. As responsible stewards of the environment, Morongo works carefully with Nestle to monitor the plant operations and conduct recharge and other environmental programs to ensure that these water resources remain healthy and reliable for future generations."

Tapping a spring

Starting in the late 1800s, Cabazon was used as a stop on the Southern Pacific railroad line. It was an attractive spot in part because of the water, which seeped down from the San Bernardino Mountains as groundwater and gushed out in Millard Canyon. The railroad used a ditch to direct the stream down to the trains, and the water was used to fill the boilers of steam locomotives.

The spring, which is surrounded by the Morongo reservation, has long been known as the SP Spring after Southern Pacific, even after the water stopped being used for trains.

The Cabazon Water District for years tapped the spring in Millard Canyon to provide part of the local drinking water supply. The water flowed through an easement granted to the water district by the tribe.

Then, in the early 2000s, the Cabazon Water District agreed to sell those water rights to the tribe for $3 million. That sale enabled the small water district to reduce its rates sharply. In return, the Morongo obtained expanded access to a spring that has been estimated to flow at a rate of up to 3,000 gallons per minute.

Within months, the tribe announced a deal with the Perrier Group of America, owned by Nestle, to produce Arrowhead water. The terms of that 25-year deal weren't disclosed, but the company said it was spending $26 million to build the plant on leased land and would pay a fee to the tribe for every gallon drawn from the ground.

The partnership was launched at a gathering of tribal officials in January 2002, joined by an audience of more than 200 people and then-Congresswoman Mary Bono.

The Arrowhead plant is one of many across the country that have been built to meet growing demand for bottled water. The U.S. bottled water market has grown from 6.2 billion gallons and $8.5 billion in revenues in 2003 to more than 10 billion gallons and $12.2 billion in revenues in 2013, according to statistics released by the New York-based Beverage Marketing Corporation. The market for bottled water dipped during the economic downturn in 2008-09, but has grown steadily again since 2010.

Nestle Waters North America, a subsidiary of Swiss-based Nestle that is headquartered in Stamford, Conn., says on its website that it has 29 bottled water facilities in the United States and Canada, with annual revenues totaling $4 billion in 2012.

Some of that revenue flows from the Cabazon plant, which is one of the largest of its kind in the nation. The factory is powered in part by two wind turbines that tower above the desert next to the I-10 freeway, with an Arrowhead logo topping one of them among the spinning blades.

Nestle Waters said in an emailed statement that its Cabazon facility "operates in strict accordance with all federal and state public health regulations, pursuant to our agreement with the Morongo Band of Mission Indians."

"We proudly conduct our business in an environmentally responsible manner that focuses on water and energy conservation," the company said. Our sustainable operations are specifically designed and managed to prevent adverse impacts to local area groundwater resources, particularly in light of California's drought conditions over the past three years."

The company didn't respond to a request for groundwater data from wells that are used to monitor water levels.

The plant takes in water through an underground pipe, which water district officials say is about 8 inches in diameter and carries water three miles downhill from the spring in Millard Canyon, passing underneath the freeway.

Much of the water in the area begins on the slopes of the San Bernardino Mountains, where it collects in canyons and flows down through oases, seeping into desert aquifers. Rain runoff and snowmelt also collect in the San Gorgonio River, which flows through the pass during wet periods.

San Gorgonio Pass is crisscrossed by earthquake fault lines. There are 11 separate groundwater basins in the area bounded by those faults, which appear to act as barriers, largely holding back water except when aquifers swell during wet periods and spill over into neighboring basins, said Jeff Davis, general manager of the San Gorgonio Pass Water Agency.

If water weren't being pumped and diverted from Millard Canyon for the bottling plant, that water would boost groundwater levels in the canyon and would gradually spread downhill into the Cabazon basin, Davis said, likening the aquifers to "separate bathtubs." The next aquifer downhill is the Coachella Valley aquifer, on the other side of a similar geological barrier.

"In a wet period, the Cabazon basin is basically going to fill up and it's going to flow over that underground weir," Davis said. "The water that overflows is going to end up in the Coachella basin."

Cabazon's aquifer, however, has been far from overflowing in recent years. The Cabazon Water District says the aquifer is in decline, with more water being pumped out than is flowing back in.

Measurements of water levels in wells, some of which are recorded in a U.S. Geological Survey database, show significant drops in groundwater levels during the past decade. Water levels in some wells in the Cabazon area have been sinking between 1 foot and 4 feet a year during the past several years.

In one well directly downhill from Millard Canyon, the water level receded from an average of 674 feet below ground in 1999 to an average of 720 feet below ground in 2008, a large drop of 46 feet, before an obstruction in the well prevented workers from taking more measurements.

Allen Christensen, a hydrologist with the U.S. Geological Survey, said the declines in groundwater levels are mainly related to years of drought.

"Historically, there have been very large swings in the Cabazon basin directly related to climate swings, wet periods and dry periods," Christensen said. He pointed to long-term records for one Cabazon well, which show water levels falling to a low during dry years in the '60s and '70s, then spiking upward during wet years in the '80s. Since 2000, the well's levels have again been dropping.

The amount of water that comes out of Millard Canyon, Christensen said, is relatively small when considered alongside various other canyons and the San Gorgonio River. For that reason, he said, the bottling plant's impact on the area's water supplies is probably relatively small.

Davis agreed, pointing out that his agency in 2012 recorded a total of 32,000 acre-feet of groundwater pumped in its entire area, from Calimesa to Cabazon. Compared to that, the estimated 750 acre-feet of water drawn from Millard Canyon represents roughly 2 percent. A single golf course can use more water.

"It's literally peanuts. It's a drop in the ocean," Davis said. "You're talking about such a small amount of water that it's kind of ridiculous to fight over that. But people will fight over water no matter what."

Squabbling and calculating

The state has since 2003 sought to revoke the Morongo Band of Mission Indians' license for a right to use about 115 acre-feet of water per year from Millard Canyon, one of three such licenses under the tribe's ownership. State officials maintain the agricultural water right had lapsed and had been forfeited because it wasn't used for many years.

The tribe attempted to challenge the proceedings by raising procedural objections, and the case eventually went before the California Supreme Court. The court's ruling favored the state in 2009, and the hearing process resumed. The parties now await a decision by the State Water Resources Control Board.

"It's a small water right, so I don't think the revocation of this water right has severe implications for that water bottling facility. But I do think it has implications for upholding the rules," said Samantha Olson, a senior staff counsel for the State Water Resources Control Board.

"It seemed unfair to every other water user in the basin to be able to pick up an antiquated water right and use it," Olson said. "You should stand in line just like anybody else and apply for that water. If you're reactivating a water right that's long since been forfeited, you're basically stepping in front of the line."

The Coachella Valley Water District initially backed those concerns in 2003, arguing that spring water from Millard Canyon is part of the Whitewater River system and that it would otherwise naturally flow into the aquifer in the Coachella Valley. CVWD attorney Gerald Shoaf said at the time that "every drop they bottle and export is a drop that is diverted from the Coachella Valley aquifer."

As the case dragged on, though, the CVWD board eventually decided to set aside its opposition to the bottling operation. The reason, Shoaf said recently, was that the water district wanted the ability to negotiate with the Morongo if necessary for permission to run a water pipeline across the reservation.

"We've agreed to suspend that, to withdraw our challenge and to not play a role," Shoaf said. "The decision by this board at that time was, it was better to hold that in abeyance and possibly use it as a negotiating point to get permission to run the pipeline across the reservation, hopefully at reduced cost. So that's where it stands."

The Coachella Valley's water agencies have explored the possibility of building a pipeline to connect with the State Water Project, which now delivers water as close as Cherry Valley, and have decided against it for the time being due to high costs. But CVWD officials say they could reconsider if the state follows through with a plan to build water tunnels beneath the Sacramento-San Joaquin River Delta, which they hope would increase water deliveries. For now, CVWD and the Desert Water Agency trade their allotted deliveries of State Water Project water for equivalent amounts from the Colorado River.

"Unless and until the pipeline project is resurrected, it's just in limbo," Shoaf said. "I don't think we would want to take the chance of joining with the state board in going after the tribe and the bottling plant at this point when there's still a possibility we're going to want a favor from them in terms of the right-of-way to get the pipeline across the reservation. It's not worth throwing away that opportunity to gain a few hundred acre-feet a year."

Jim Barrett, CVWD's general manager, said the water agency first intends to see how the Delta plan plays out before approaching Morongo leaders.

"Then if it makes sense to build a pipeline, we'll engage with the Morongos," Barrett said. "But that's probably 10 years away."

Bottling plant generating debate

When the Agua Caliente Band of Cahuilla Indians sued the Coachella Valley's two largest water agencies last year and accused them of mismanaging the water supply, some of the agencies' managers asked whether the tribe's motives could include selling bottled water. Jeff Grubbe, the tribe's chairman, denied having any such plans. But that exchange illustrated how the bottling plant on the Morongo reservation has stirred suspicions and generated debate.

Some residents say selling the area's water isn't in the community's best interest and seems especially unjustified during one of the worst droughts in California's modern history.

Others argue the Nestle plant benefits the community. Riverside County Supervisor Marion Ashley pointed to the jobs it provides and noted that some of the bottled water is sold locally.

"That's the highest, best use of water is drinking it," Ashley said. "They overlie that water and they have superior rights to it, and they probably have superior rights to anybody downstream."

Water agencies in Cabazon as well as the Coachella Valley have acknowledged the Morongo water rights while also calling for the tribe to release more information about how much water it is using.

"They're entitled to use the groundwater basin, too. Everyone is. But it's just a shame that this water is not being used locally. It's being exported," said David Luker, general manager of the Desert Water Agency. He said DWA's position has been that the Morongo tribe should have to report its water use just like other entities.

"I don't believe there's any way to force them to fork over groundwater pumping information unless there's discovery in a lawsuit," Luker said. But he said the level of concern about the bottling plant in the area doesn't seem to have grown to a degree that leads to such action.

Other concerns are raised by people who live in a neighborhood of mobile homes near the bottling factory. Some say they wish the plant would provide more jobs because many are unemployed. Others say despite living next to the Arrowhead plant, their local water service is poor, with sputtering faucets and frequent breaks in water lines.

"Who knows how much water they're pumping out of there and taking," said Jesse Wallis, who does construction jobs and said he wishes there were more work opportunities at the plant.

"We hear them honking there every night, pulling trucks in and pulling them out," Wallis said. "We don't hear nothing from them, just the trucks."

For years, the Cabazon Water District supplied millions of gallons of water to the Nestle Waters plant. The company informed the agency that the water was for internal uses such as sinks, toilets and cleaning the factory. But in 2010, that water supply agreement broke down.

Calvin Louie, the Cabazon Water District's general manager, said he tried unsuccessfully to convince the Arrowhead plant managers to follow through on pledges made verbally years earlier, including offers of paying for road improvements and a new water line running down a nearby street to support development.

The water district, Louie said, also wanted a formal agreement in which the company would agree not to export any of the water supplied. "And that's when we couldn't come to an agreement."

When the negotiations failed, the Cabazon Water District's board decided to cut off water service to the bottling plant. The board at the time saw it as a moral decision, Louie said, because they didn't want the community's water being bottled and shipped elsewhere.

The water district took a financial hit when it lost the roughly $120,000 a year that the bottling plant was paying in water bills. The small agency, which supplies water to the community of about 2,500 people, was forced to raise its rates to cover the loss.

Nestle turned to the Morongo tribe for water service, using a new well near the plant.

Louie said that the tribe and Nestle aren't required to report their groundwater pumping to the water district, but that ultimately sharing information on water use would help efforts to manage the declining aquifer. He said the water district's relationship with the tribe has improved in recent years.

Unlike other areas nearby, Cabazon's aquifer has not been adjudicated by a court. In Beaumont, in contrast, there is a court-appointed entity that oversees groundwater pumping and ensures that water use doesn't exceed a "safe yield." The relative lack of controls in Cabazon, Louie said, makes it something of a "wild, wild west of water."

Louie, a cowboy hat-wearing former police officer who turned to water management as a second career, said some of the water district's officials have spoken with the Morongo tribe recently about a need for more dialogue to stem the depletion of the Cabazon aquifer.

Two of the water district's five board members were elected last year with campaigns that included blaming predecessors for selling water rights and saying the bottling plant has been detrimental to groundwater levels. One of their campaign signs was posted beside the train tracks at the time, reading: "Our water rights were sold. Our profits squandered. Arrowhead was built, lowering our water table. What's next?"

Asked his view about the bottling plant, Louie said he sees both pluses and minuses.

"Arrowhead provides a lot of jobs, and that helps the economy. On the other hand, Arrowhead has a reputation of going into small communities and taking advantage — and basically, pump them dry and 'good to the last drop,'" Louie said. He cited the example of McCloud, a small town near Mount Shasta, where Nestle scrapped plans to build a water bottling plant in 2009 after facing strong opposition. While fighting plans for that plant, one community leader from McCloud called Louie to ask about the history of Nestle's operation in Cabazon.

Any water bottling business, Louie said, can prompt worries about depleting local water supplies. And he pointed out there are many other privately owned wells drawing on water supplies – from the Morongo Casino, Resort & Spa to the Robertson's Ready Mix plant.

"Everybody affects the aquifer, the water level, but who's to blame? Well, you know, when you don't have the data and when you have no groundwater management, it's a shot in the dark. But everybody needs to be responsible," Louie said. "We need to limit the amount of water we pull because Mother Nature is not replenishing it right now."

Louie said that he hopes a lawsuit won't be necessary to achieve a better balance, and that all of the parties drawing water from private wells seem open to having a dialogue about Cabazon's water issues.

"I'd like to see everybody come to the table and let's just lay out our cards and let's just see what's best for the region, because I think everybody benefits," Louie said, explaining that he hopes to see the tribe and others with private wells report how much water they are pumping — as well as how much they could cut back in response to the drought.

"I think now is the time, not a month after we find out that we're completely depleted. Now is the time to start talking."

Robert Hopwood and Lynne Stephenson contributed to this story.

Reporter Ian James can be reached at Ian.James@desertsun.com and on Twitter @TDSIanJames.

ABOUT THE SERIES: BEYOND DROUGHT

As California confronts some of its driest times on record, the state also faces bigger, more systemic problems of growing water scarcity that go beyond the drought. Even in years with more rainfall, there often isn't enough water to slake the thirst of agriculture and growing cities and towns.

Heavy pumping of groundwater is drawing down aquifers, while reservoirs are running low in places from the Central Valley to the Colorado River. This growing gap, with demands for water regularly outstripping supplies, is prompting difficult questions about what sorts of uses should take precedence and how to stretch water supplies further.

In this series of occasional articles, The Desert Sun is examining how the region is hitting its water limits and how those constraints are affecting life and prompting discussion about rethinking California's water priorities.

Read more of the series and previous water coverage at DesertSun.com/Water. Another recent Desert Sun series focusing on the impacts of climate change in the Southwest can be found at DesertSun.com/ClimateChange.